Golden Queen Mining Co. Ltd. - Exhibit 10.4 - Filed by newsfilecorp.com






Exhibit 10.4 

REGISTRATION RIGHTS AGREEMENT 

     REGISTRATION RIGHTS AGREEMENT,
dated as of June 8, 2014, by and among Golden Queen Mining Co. Ltd., a British
Columbia company (the “Company”), Auvergne, LLC, a
Delaware limited liability company (“Auvergne”), and the holders
set forth on Schedule A (the “Clay Family
Holders”).

     WHEREAS, the Company, Gauss
Holdings LLC and Auvergne are parties to that certain Standby Purchase
Agreement, dated as of June 8, 2014 (the “Backstop Agreement”), entered
into in connection with a proposed rights offering to be conducted by the
Company (the “Rights Offering”); 

     WHEREAS, concurrently with the
execution of this Agreement, the Company, LUK Holdco and certain other parties
entered into that certain Transaction Agreement pursuant to which LUK Holdco,
through Gauss LLC, a subsidiary of LUK Holdco, will make an investment into a
subsidiary of the Company (the “Transaction Agreement”); and 

     WHEREAS, in consideration of the
undertakings of Auvergne pursuant to the Backstop Agreement, the Company has
agreed to provide the Holders (defined below) certain rights as set forth
herein. 

     NOW, THEREFORE, in consideration
of the premises and of the mutual covenants and obligations hereinafter set
forth (and for other good and valuable consideration the receipt and sufficiency
of which are hereby acknowledged by the Company), the parties hereto hereby
agree as follows: 

ARTICLE I 

DEFINITIONS 

     Section 1.1. Certain Defined
Terms. As used herein, the following terms shall have the following
meanings: 

     “Action”
means any legal, administrative, regulatory or other suit, action, claim, audit,
assessment, arbitration or other proceeding, investigation or inquiry. 

     “Affiliate”
shall mean, with respect to any Person, any other Person directly or indirectly
controlling, controlled by or under common control with, such Person. For
purposes of this definition, “control” when used with respect to any Person,
means the possession, directly or indirectly, of the power to cause the
direction of management and/or policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. 

     “Agreement”
means this Registration Rights Agreement as it may be amended, supplemented,
restated or modified from time to time. 

     “Backstop
Registrable Securities” means all Common Shares purchased by
Auvergne under the terms of the Backstop Agreement.




     “Beneficial
Ownership” by a Person of any securities includes ownership by
any Person who, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares (i) voting power which
includes the power to vote, or to direct the voting of, such security; and/or
(ii) investment power which includes the power to dispose, or to direct the
disposition, of such security; and shall otherwise be interpreted in accordance
with the term “beneficial ownership” as defined in Rule 13d-3 adopted by the SEC
under the Exchange Act. The term “Beneficially Own”
shall have a correlative meaning. 

     “Business
Day” means any day, other than a Saturday, Sunday or a day on
which banking institutions in New York, New York are authorized or obligated to
close. 

     “Common
Shares” means the common shares, no par value per share, of the
Company. 

     “Exchange
Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the SEC from time to time thereunder.


     “Governmental
Entity” shall mean any court, administrative agency or commission
or other governmental authority or instrumentality, whether federal, state,
local or foreign and any applicable industry self-regulatory organization. 

     “Holders”
means Auvergne, the Clay Family Holders and any Transferee of their Registrable
Securities (and “Holder” means any of such Persons). 

     “Holders’
Representative” means Auvergne or any other Holder designated by
Auvergne as the Clay Holders’ Representative. 

     “Issuer Free Writing
Prospectus” means an issuer free writing prospectus, as defined
in Rule 433 under the Securities Act, relating to an offer of the Registrable
Securities. 

     “Law”
means any statute, law, code, ordinance, rule or regulation of any Governmental
Entity. 

     “Other
Securities” means Common Shares other than Registrable Securities.


     “Person”
means any individual, corporation, limited liability company, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization, government or any agency or political subdivisions
thereof or any group (within the meaning of Section 13(d)(3) of the Exchange
Act) comprised of two or more of the foregoing. 

     “Prospectus”
means the prospectus included in any Registration Statement (including a
prospectus that discloses information previously omitted from a prospectus filed
as part of an effective Registration Statement in reliance upon Rule 430A or
Rule 430B promulgated under the Securities Act), as amended or supplemented by
any prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by such Registration Statement,
any Issuer Free Writing Prospectus related thereto, and all other amendments and
supplements to such prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such prospectus. 

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     “Registrable
Securities” means (a) all Common Shares Beneficially Owned by
Auvergne and the Clay Family Holders on the date of the closing of the
transactions contemplated by the Transaction Agreement and all Backstop
Registrable Securities, (b) any securities issued directly or indirectly with
respect to such Common Shares described in clause (a) because of stock splits,
stock dividends, reclassifications, recapitalizations, mergers, share exchanges,
reorganizations, consolidations, or similar events, and (c) any of such Common
Shares or other securities transferred to a Transferee, but excluding, as to any
particular Registrable Securities, (w) Common Shares, if any, which have been
transferred pursuant to a Registration Statement that is effective under the
Securities Act, (x) Common Shares, owned by Holders who are not Affiliates of
the Company, that are eligible for sale without restriction pursuant to Rule
144(b)(1)(i) (or any successor provision) under the Securities Act, (y) Common
Shares which are otherwise eligible to be sold to the public without application
of the volume restrictions pursuant to Rule 144 (or any successor provision)
under the Securities Act and (z) Common Shares or other securities which have
been transferred to any Person who is not a Transferee. 

     “Registration
Statement” means any registration statement of the Company under
the Securities Act which permits the public offering of any of the Registrable
Securities pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to such registration statement, including
post-effective amendments, all exhibits and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement. 

     “Rule
144” means Rule 144 under the Securities Act (or any successor
provision). 

     “SEC”
means the United States Securities and Exchange Commission. 

     “Securities
Act” means the Securities Act of 1933, as amended, and the rules
and regulations promulgated by the SEC from time to time thereunder. 

     “Selling
Holder” means each Holder of Registrable Securities included in a
registration pursuant to Article II. 

     “Subsidiary”
of any Person shall mean those corporations and other entities of which such
Person owns or controls more than 50% of the outstanding equity securities
either directly or through an unbroken chain of entities as to each of which
more than 50% of the outstanding equity securities is owned directly or
indirectly by its parent. 

     “Transferee”
means any Person to whom the rights and obligations hereunder have been assigned
with the prior written consent of the Company pursuant to Section 3.6 hereof.


     Section 1.2. Terms
Generally. The definitions in Section 1.1 shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words “include”, “includes” and “including” shall be deemed to
be followed by the phrase “without limitation”, unless the context expressly
provides otherwise. All references herein to Articles, Sections, paragraphs,
subparagraphs, clauses or Exhibits shall be deemed references to Articles,
Sections, paragraphs, subparagraphs or clauses of, or Exhibits to, this
Agreement, unless the context requires otherwise. Unless otherwise expressly
defined, terms defined in this Agreement have the same meanings when used in any Exhibit hereto. Unless
otherwise specified, the words “this Agreement”, “herein”, “hereof”, “hereto”
and “hereunder” and other words of similar import refer to this Agreement as a
whole (including the Exhibits) and not to any particular provision of this
Agreement. The term “or” is not exclusive. The word “extent” in the phrase “to
the extent” shall mean the degree to which a subject or other thing extends, and
such phrase shall not mean simply “if”. Unless expressly stated otherwise, any
Law defined or referred to herein means such Law as from time to time amended,
modified or supplemented, including by succession of comparable successor Laws
and references to all attachments thereto and instruments incorporated therein.
References to a Person are also to its permitted successors and assigns. The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.

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ARTICLE II 

REGISTRATION RIGHTS 

     Section 2.1. Demand
Registrations.     Provided that the Company has
elected to require Auvergne to effect the Backstop Commitment (as defined in the
Backstop Agreement) and Auvergne has fulfilled its Backstop Commitment under the
terms of the Backstop Agreement to purchase Common Shares in connection with the
Rights Offering, then at any time and from time to time following the Backstop
Closing Date (as defined in the Backstop Agreement), the Holders’ Representative
shall have the right by delivering a written notice to the Company (a
“Demand Notice”) to require the
Company to, pursuant to the terms of this Agreement, register under and in
accordance with the provisions of the Securities Act the number of Registrable
Securities owned by the Holders and requested by such Demand Notice to be so
registered (a “Demand
Registration”); provided, however, that a Demand
Notice may only be made if (i) the aggregate gross proceeds expected to be
received from the sale of the Registrable Securities requested to be included in
such Demand Registration are at least US$5,000,000 based on the volume-weighted
average price of the Common Shares during the 20-day period prior to the Demand
Notice or (ii) the Holders are requesting to register all of the Registrable
Securities owned by the Holders at such time. A Demand Notice shall also specify
the expected method or methods of disposition of the applicable Registrable
Securities. Following receipt of a Demand Notice, the Company shall use its
reasonable best efforts to file, as promptly as reasonably practicable, but not
later than, 60 days with respect to any underwritten offering, or 30 days with
respect to any other offering, after receipt by the Company of such Demand
Notice (subject to paragraph (e) of this Section 2.1), a Registration Statement
relating to the offer and sale of the Registrable Securities requested to be
included therein by the Holders thereof in accordance with the methods of
distribution elected by such Holders (a “Demand Registration
Statement”) and shall use its reasonable best efforts to cause
such Registration Statement to be declared effective under the Securities Act as
promptly as practicable after the filing thereof. 

     (b)     No
securities shall be included under any Demand Registration Statement related to
an underwritten offering without the written consent of the Holders’
Representative, except Registrable Securities requested to be included therein
pursuant to Section 2.1(a) . Subject to the preceding sentence, if any of the
Registrable Securities registered pursuant to a Demand Registration are to be
sold in a firm commitment underwritten offering, and the managing underwriter(s)
of such underwritten offering advise the Holders in writing that it is their
good faith opinion that the total number or dollar amount of Registrable
Securities proposed to be sold in such offering, together with any Other
Securities proposed to be included by holders thereof which are entitled to
include securities in such Registration Statement, exceeds the total number or
dollar amount of such securities that can be sold without having an adverse
effect on the amount, price, timing or distribution of the Registrable
Securities to be so included together with all such Other Securities, then there
shall be included in such offering the number or dollar amount of Registrable
Securities and such Other Securities that in the opinion of such managing
underwriter(s) can be sold without so adversely affecting such offering, and
such number of Registrable Securities and Other Securities shall be allocated
for inclusion as follows:

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          (i)     first,
the Registrable Securities for which inclusion in such demand offering was
requested by the Holders, pro rata (if applicable) as nearly as
practicable, based on the number of Registrable Securities Beneficially Owned by
each such Holder; and 

          (ii)     second,
among any holders of Other Securities, pro rata as nearly as practicable,
based on the number of Other Securities Beneficially Owned by each such holder.


     (c)     The
Holders collectively shall be entitled to request no more than two Demand
Registrations of the Company, and in no event shall the Company be required to
effect more than one Demand Registration in any six month period. 

     (d)     In
the event of a Demand Registration, the Company shall use its reasonable best
efforts to maintain the continuous effectiveness of the applicable Registration
Statement for a period of at least 180 days after the effective date thereof or
such shorter period in which all Registrable Securities included in such
Registration Statement have actually been sold. For the avoidance of doubt, the
foregoing sentence is not intended to limit the obligation of the Company to
maintain the continuous effectiveness of the Short-Form Registration
contemplated by Section 2.1(h) as required by Section 2.1(h) . 

     (e)     The
Company shall be entitled to postpone (but not more than once in any six-month
period), for a reasonable period of time not in excess of 60 days (and not for
periods exceeding, in the aggregate, 90 days during any twelve-month period),
the filing or initial effectiveness of, or suspend the use of, a Registration
Statement if the Company delivers to the Holders’ Representative a certificate
signed by both the Chief Executive Officer and Chief Financial Officer of the
Company certifying that, in such officers’ good faith judgment, (A) such
registration, offering or use would reasonably be expected to materially
adversely affect or materially interfere with a material pending financing,
acquisition, disposition, corporate reorganization, merger, public offering of
securities, or other material transaction involving or being contemplated by the
Company, or other similarly material events then concerning the Company, (B) the
Company is in possession of material non-public information not otherwise then
required by Law to be publicly disclosed and that the Company deems advisable
not to disclose in such Registration Statement, or (C) a requirement to include
pro forma information, which requirement the Company is reasonably unable to
comply with at such time. 

     (f)     The
Holders’ Representative shall have the right to notify the Company that it has
determined that the Registration Statement relating to a Demand Registration be
abandoned or withdrawn, in which event the Company shall promptly abandon or
withdraw such Registration Statement.

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     (g)     No
request for registration will count for the purposes of the limitations in
Section 2.1(c) if: (A) the Holders’ Representative determines in good faith to
withdraw the proposed registration prior to the effectiveness of the
Registration Statement relating to such request due to marketing conditions or
regulatory reasons relating to the Company, (B) the Registration Statement
relating to such request is not declared effective within 60 days of the date
such Registration Statement is first filed with the SEC (other than solely by
reason of the applicable Holders having refused to proceed), (C) prior to the
sale of at least 90% of the Registrable Securities included in the applicable
registration relating to such request, such registration is adversely affected
by any stop order, injunction or other order or requirement of the SEC or other
Governmental Entity or court, (D) more than 25% of the Registrable Securities
requested by the Holders to be included in the registration are not so included
pursuant to Section 2.1(b), or (E) the conditions to closing specified in any
underwriting agreement or purchase agreement entered into in connection with the
registration relating to such request are not satisfied (other than as a result
of a material default or breach thereunder by the applicable Holders). Except
for any registration withdrawn pursuant to one of (A) through (E) above or
Section 2.2(a), the Selling Holders shall reimburse the Company for all
reasonable and documented out-of-pocket fees and expenses incurred by the
Company in connection with any registration which is not completed solely due to
actions or elections of the Holders. 

     (h)     In
addition to the foregoing, the Company will use its reasonable best efforts to
qualify for registration on Form S-3 (including, if feasible, any registration
statement on Form S-3 filed in connection with the Rights Offering) or any
comparable or successor form or forms or any similar short-form registration
(“Short-Form Registration”) and such Short-Form Registration shall
be filed by the Company as promptly as practicable and shall constitute a
“shelf” registration statement providing for the registration of, and the sale
on a continuous or delayed basis (notwithstanding anything to the contrary in
Section 2.1(d)) of, the Registrable Securities, pursuant to Rule 415 under the
Securities Act, to permit the distribution of the Registrable Securities in
accordance with the methods of distribution elected by the Holders, including by
means of an underwritten offering. Upon filing a Short-Form Registration, the
Company shall use its reasonable best efforts to keep such Short-Form
Registration effective with the SEC at all times and any Short-Form Registration
shall be re-filed upon its expiration, and, subject to Section 2.1(e), the
Company shall cooperate in any shelf take-down by amending or supplementing the
Prospectus related to such Short-Form Registration as may be reasonably
requested by the Holders’ Representative or as otherwise required, until the
Holders no longer hold Registrable Securities (in each case, notwithstanding
anything to the contrary in Section 2.1(d)) . 

     Section
2.2.     Piggyback
Registrations.     (a)     If,
other than pursuant to Section 2.1, the Company proposes or is required to file
a registration statement under the Securities Act with respect to an offering of
Common Shares, whether or not for sale for its own account other than a
registration (i) on Form S-4, Form S-8 or any successor forms thereto, (ii) on
any other registration form which may not be used for the registration or
qualification for distribution of Registrable Securities, (iii) filed solely in
connection with any employee benefit or dividend reinvestment plan, (iv) a
registration relating solely to a Rule 145 transaction under the Act, or (v) of
any at-the-market offerings in the aggregate not to exceed US$20,000,000, then
the Company shall give prompt written notice of such proposed
filing at least 30 days before the anticipated filing date (the
“Piggyback Notice”) to the Holders of Registrable
Securities. The Piggyback Notice shall offer the Holders of Registrable
Securities the opportunity to include in such registration statement the number
of Registrable Securities as they may request (a “Piggyback
Registration”). Subject to Section 2.2(b) hereof, the Company
shall include in each such Piggyback Registration all Registrable Securities
with respect to which the Company has received written requests for inclusion
therein within 10 days after notice has been given to the Holders of Registrable
Securities, to permit the distribution of such Registrable Securities in
accordance with the methods of distribution set forth in such registration
statement. Such Holders shall be permitted to withdraw all or part of the
Registrable Securities from a Piggyback Registration at any time at least two
Business Days prior to the effective date of the Registration Statement relating
to such Piggyback Registration. The Company shall use its reasonable best
efforts to maintain the effectiveness of such Registration Statement for a
Piggyback Registration for a period of at least 180 days after the effective
date thereof or such shorter period in which all Registrable Securities included
in such Registration Statement have actually been sold. No Piggyback
Registration shall count towards registrations required under Section 2.1.

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     (b)     If
any of the securities to be registered pursuant to the registration giving rise
to the Holders’ rights under this Section 2.2 are to be sold in an underwritten
offering, the Holders shall be permitted to include all Registrable Securities
requested to be included in such registration in such offering on the same terms
and conditions as any Other Securities included therein; provided,
however, that if such offering involves a firm commitment underwritten
offering and the managing underwriter(s) of such underwritten offering advise
the Company in writing that it is their good faith opinion that the total amount
of Registrable Securities requested to be so included, together with all Other
Securities that the Company and any other Persons having rights to participate
in such registration intend to include in such offering, exceeds the total
number or dollar amount of such securities that can be sold without having an
adverse effect on the price, timing or distribution of the Registrable
Securities to be so included together with all Other Securities, then there
shall be included in such firm commitment underwritten offering the number or
dollar amount of Registrable Securities and such Other Securities that in the
opinion of such managing underwriter(s) can be sold without so adversely
affecting such offering, and such number of Registrable Securities and Other
Securities shall be allocated for inclusion as follows: 

          (i)     first,
all Other Securities being sold by the Company for its own account or by any
Person (other than a Holder) exercising a contractual right to demand
registration; 

          (ii)     second,
all Registrable Securities requested to be included by the Holders, pro
rata (if applicable) as nearly as practicable, based on the number of
Registrable Securities Beneficially Owned by each such Holder; and 

          (iii)     third,
among any other holders of Other Securities requesting such registration, pro
rata as nearly as practicable, based on the number of Other Securities
Beneficially Owned by each such holder of Other Securities. 

     (c)     In
the case of an offering initiated by the Company as a primary offering on behalf
of the Company, nothing contained herein shall prohibit the Company from
determining, at any time, not to file a registration statement or, if filed, to
withdraw such registration or terminate or abandon the offering related thereto.

7 




     Section 2.3. Registration
Procedures. If and whenever the Company is required to use its reasonable
best efforts to effect the registration of any Registrable Securities under the
Securities Act as provided in Article II, the Company shall effect such
registration to permit the sale of such Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company shall cooperate in the sale of the securities and shall, as
expeditiously as possible: 

     (a)     Prepare
and file with the SEC a Registration Statement or Registration Statements on
such form which shall be available for the sale of the Registrable Securities by
the Holders or the Company in accordance with the intended method or methods of
distribution thereof, and use its reasonable best efforts to cause such
Registration Statement to become effective and to remain effective as provided
herein; provided, however, that before filing a Registration Statement or
Prospectus or any amendments or supplements thereto (but not including any Form
8-K, Form 10-Q, proxy statement or other similar filing or amendment thereto
that would be incorporated or deemed to be incorporated therein by reference),
the Company shall furnish or otherwise make available to the Selling Holders,
their counsel and the managing underwriter(s), if any, copies of all such
documents proposed to be filed, which documents will be subject to the
reasonable review and comment of such counsel, and any comment letter relating
to such document from the SEC, and, if requested by such counsel, provide such
counsel reasonable opportunity to participate in the preparation of such
Registration Statement and each Prospectus included therein (but not including
any Form 8-K, Form 10-Q, proxy statement or other similar filing or amendment
thereto that would be incorporated or deemed to be incorporated therein by
reference).

     (b)     Prepare
and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary to keep such Registration Statement
continuously effective during the period provided herein and comply in all
material respects with the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration Statement, and cause
the related Prospectus to be supplemented by any Prospectus supplement or Issuer
Free Writing Prospectus as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of the securities covered by such
Registration Statement, and as so supplemented to be filed pursuant to Rule 424
(or any similar provisions then in force) under the Securities Act. 

     (c)     Notify
each Selling Holder and the managing underwriter(s), if any, promptly, and (if
requested by any such Person) confirm such notice in writing, (i) when a
Prospectus or any Prospectus supplement, Issuer Free Writing Prospectus or
post-effective amendment has been filed (but not including any Form 8-K, Form
10-Q, proxy statement or other similar filing or amendment thereto that would be
incorporated or deemed to be incorporated therein by reference, unless a request
for registration pursuant to Section 2.1 or 2.2 has been made), and, with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective, (ii) of any request by the SEC or any other
Governmental Entity for amendments or supplements to a Registration Statement or
related Prospectus or Issuer Free Writing Prospectus or for additional
information, (iii) of the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any proceedings
for that purpose, (iv) if at any time the representations and warranties of the
Company contained in any underwriting agreement contemplated by Section 2.3(o)
below cease to be true and correct, (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any proceeding for such
purpose, and (vi) of the happening of any event that makes any statement made in
such Registration Statement or related Prospectus or any document incorporated
or deemed to be incorporated therein by reference or any Issuer Free Writing
Prospectus related thereto untrue in any material respect or that requires the
making of any changes in such Registration Statement, Prospectus, documents or
Issuer Free Writing Prospectus so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, not misleading, and that in the case of any Prospectus
or Issuer Free Writing Prospectus, it will not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

8 




     (d)     Use
its reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement, or the lifting of any suspension of
the qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction at the reasonably earliest practical
date. 

     (e)     If
requested by the managing underwriter(s), if any, or the Holders of a majority
of the Registrable Securities being sold in connection with an underwritten
offering, promptly include in a Prospectus supplement, post-effective amendment
or Issuer Free Writing Prospectus such information as the managing
underwriter(s), if any, or such Holders may reasonably request in order to
permit the intended method of distribution of such securities and make all
required filings of such Prospectus supplement, such post-effective amendment or
Issuer Free Writing Prospectus as soon as practicable after the Company has
received such request. 

     (f)     Furnish
or make available to each Selling Holder, and each managing underwriter, if any,
without charge, such number of conformed copies of the Registration Statement
and each post-effective amendment thereto, including financial statements (but
excluding schedules, all documents incorporated or deemed to be incorporated
therein by reference, and all exhibits, unless requested in writing by such
Holder, counsel or managing underwriter(s)), and such other documents, as such
Holders or such managing underwriter(s) may reasonably request, and upon request
a copy of any and all transmittal letters or other correspondence to or received
from, the SEC or any other Governmental Entity relating to such offering. 

     (g)     Deliver
to each Selling Holder, and the managing underwriter(s), if any, without charge,
as many copies of the Prospectus or Prospectuses (including each form of
Prospectus and any Issuer Free Writing Prospectus related to any such
Prospectuses) and each amendment or supplement thereto as such Persons may
reasonably request in connection with the distribution of the Registrable
Securities; and the Company, subject to Section 2.4(b), hereby consents to the
use of such Prospectus and each amendment or supplement thereto by each of the
Selling Holders and the managing underwriter(s), if any, in connection with the
offering and sale of the Registrable Securities covered by such Prospectus and
any such amendment or supplement thereto. 

9 




     (h)     Prior
to any public offering of Registrable Securities, use its reasonable best
efforts to register or qualify or cooperate with the Selling Holders, the
managing underwriter(s), if any, and their respective counsel in connection with
the registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or “Blue Sky” laws of such jurisdictions within the United States as
any Selling Holder or managing underwriter(s) reasonably requests in writing and
to keep each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is required to be kept
effective and to take any other action that may be necessary or advisable to
enable such Selling Holders to consummate the disposition of such Registrable
Securities in such jurisdiction; provided, however, that the Company will
not be required to (i) qualify generally to do business in any jurisdiction
where it is not then so qualified, (ii) subject itself to taxation in any such
jurisdiction where it is not then so subject, or (iii) take any action that
would subject it to general service of process in any such jurisdiction where it
is not then so subject. 

     (i)     Cooperate
with the Selling Holders and the managing underwriter(s), if any, to facilitate
the timely preparation and delivery of certificates (not bearing any legends)
representing Registrable Securities to be sold after receiving written
representations from each Selling Holder that the Registrable Securities
represented by the certificates so delivered by such Selling Holder will be
transferred in accordance with the Registration Statement, and enable such
Registrable Securities to be in such denominations and registered in such names
as the managing underwriter(s), if any, or the Selling Holders may request at
least two Business Days prior to any sale of Registrable Securities. 

     (j)     Use
its reasonable best efforts to cause the Registrable Securities covered by the
Registration Statement to be registered with or approved by such other
Governmental Entities within the United States, except as may be required solely
as a consequence of the nature of such Selling Holder’s business, in which case
the Company will cooperate in all reasonable respects with the filing of such
Registration Statement and the granting of such approvals, as may be necessary
to enable the seller or sellers thereof or the managing underwriter(s), if any,
to consummate the disposition of such Registrable Securities. 

     (k)     Upon
the occurrence of any event contemplated by Section 2.3(c)(ii), (c)(iii),
(c)(iv), (c)(v) or (c)(vi) above, prepare a supplement or post-effective
amendment to the Registration Statement or a supplement to the related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference or an Issuer Free Writing Prospectus related thereto, or file any
other required document so that, as thereafter delivered to the Selling Holders,
such Prospectus will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. 

     (l)     Prior
to the effective date of the Registration Statement relating to the Registrable
Securities, provide a CUSIP number for the Registrable Securities. 

     (m)     Provide
and cause to be maintained a transfer agent and registrar for all Registrable
Securities covered by such Registration Statement from and after a date not
later than the effective date of such Registration Statement. 

10 




     (n)     Use
its reasonable best efforts to cause all shares of Registrable Securities
covered by such Registration Statement to be authorized to be listed on the
Toronto Stock Exchange or another exchange in Canada or elsewhere, if any, on
which similar securities issued by the Company are then listed. 

     (o)     In
connection with an underwritten offering, if any, enter into an underwriting
agreement in form, scope and substance as is customary in underwritten
offerings, and in connection therewith, (i) make such representations and
warranties to the Selling Holders and the managing underwriter(s), if any, with
respect to the business of the Company and its Subsidiaries, and the
Registration Statement, Prospectus and documents, if any, incorporated or deemed
to be incorporated by reference therein, in each case, in form, substance and
scope as are customarily made by issuers in underwritten offerings, and, if
true, confirm the same if and when requested, (ii) use its reasonable best
efforts to furnish to the Selling Holders of such Registrable Securities
opinions and negative assurances of counsel to the Company and updates thereof
(which counsel, opinions and negative assurance (in form, scope and substance)
shall be reasonably satisfactory to the managing underwriter(s), if any, and
counsels to the Selling Holders of the Registrable Securities), addressed to
each Selling Holder of Registrable Securities and each of the managing
underwriter(s), if any, covering the matters customarily covered in opinions and
negative assurances requested in underwritten offerings and such other matters
as may be reasonably requested by such counsel and managing underwriter(s),
(iii) use its reasonable best efforts to obtain “comfort” letters and updates
thereof from the independent certified public accountants of the Company (and,
if necessary, any other independent certified public accountants of any
Subsidiary of the Company or of any business acquired by the Company for which
financial statements and financial data are, or are required to be, included in
the Registration Statement) who have certified the financial statements included
in such Registration Statement, addressed to each Selling Holder of Registrable
Securities (unless such accountants shall be prohibited from so addressing such
letters by applicable standards of the accounting profession) and each of the
managing underwriter(s), if any, such letters to be in customary form and
covering matters of the type customarily covered in “comfort” letters in
connection with underwritten offerings, (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and procedures
substantially to the effect set forth in Section 2.5 hereof with respect to all
parties to be indemnified pursuant to said Section except as otherwise agreed by
the Holders of a majority of the Registrable Securities being sold in connection
therewith and the managing underwriter(s), if any, and (v) deliver such
customary documents and certificates as may be reasonably requested by the
Holders of a majority of the Registrable Securities being sold in connection
therewith, their counsel and the managing underwriter(s), if any, to evidence
the continued validity of the representations and warranties made pursuant to
clause (i) above and to evidence compliance with any customary conditions
contained in the underwriting agreement or other agreement entered into by the
Company. The above shall be done at each closing under such underwriting or
similar agreement, or as and to the extent required thereunder. 

     (p)     Upon
execution of a customary confidentiality agreement, pursuant to which the
Holders agree to use the following information solely for the purpose of their
due diligence review in connection with an offering of securities by the
Company, make available for inspection by a representative of the Selling
Holders, the managing underwriter(s), if any, and any attorneys or accountants
retained by such Selling Holders or managing underwriter(s), at the offices
where normally kept, during reasonable business hours, financial and other
records, pertinent corporate documents and properties of the Company and its Subsidiaries,
each of the type which would be included in a reasonable and customary due
diligence review in connection with an offering of securities, and cause the
officers, directors and employees of the Company and its Subsidiaries to supply
all information in each case reasonably requested by any such representative,
managing underwriter(s), attorney or accountant in connection with such
Registration Statement.

11 




     (q)     Subject
to the provisions of Section 2.7(b) hereof, in connection with any Demand
Registration that is a “fully underwritten marketed offering”, cause its
officers to use their reasonable best efforts to support the marketing of the
Registrable Securities covered by the Registration Statement (including, without
limitation, by participation in “road shows”) as reasonably requested by the
underwriters; provided that such officers shall not be required to take
any action which would unreasonably interfere with the normal business
operations of the Company. 

     (r)     Otherwise
use its reasonable best efforts to comply with all applicable rules and
regulations of the SEC and any applicable national securities exchange, and make
available to its security holders, as soon as reasonably practicable (but not
more than 18 months) after the effective date of the registration statement, an
earnings statement which shall satisfy the provisions of Section 11(a) of the
Securities Act. 

     Section 2.4. Certain
Additional Agreements. 

     (a)     The
Company may require each Selling Holder to furnish to the Company in writing
such information required in connection with such registration regarding such
Selling Holder and the distribution of such Registrable Securities as the
Company may, from time to time, reasonably request in writing and the Company
may exclude from such registration the Registrable Securities of any Selling
Holder who fails to furnish such information within a reasonable time after
receiving such request. 

     (b)     Each
Selling Holder agrees that upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 2.3(c)(iii) or (c)(vi)
hereof, such Holder will forthwith discontinue disposition of such Registrable
Securities covered by such Registration Statement or Prospectus until such
Holder’s receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 2.3(k) hereof, or until it is advised in writing by the
Company that the use of the applicable Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
or deemed to be incorporated by reference in such Prospectus; provided,
however, that (i) in no event shall such discontinuance exceed the time
period set forth in Section 2.1(e) hereof, and (ii) the Company shall extend the
time periods under Section 2.1 and Section 2.2 with respect to the length of
time that the effectiveness of a Registration Statement must be maintained by
the amount of time the Holder is required to discontinue disposition of such
securities. 

     (c)     Each
Holder covenants and agrees that it will comply with the prospectus delivery
requirements of the Securities Act as applicable to it or an exemption therefrom
in connection with sale of Registrable Securities pursuant to the Registration
Statement. 

12 




     Section 2.5.
Indemnification. 

     (a)     Indemnification
by the Company. The Company shall indemnify and hold harmless, to the
fullest extent permitted by Law, each Selling Holder whose Registrable
Securities are covered by a Registration Statement or Prospectus, the officers
and directors of each of them, each Person who controls (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) each such
Selling Holder and the officers and directors of each such controlling Person,
each underwriter (including any Holder that is deemed an underwriter pursuant to
any SEC comments or policies, if any, and each Person who controls (within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act)
such underwriter (collectively, “Holder
Indemnitees”), from and against any and all losses, claims,
damages, liabilities, expenses (including, without limitation, costs of
preparation and reasonable attorneys’ fees and any other reasonable fees or
expenses incurred by such party in connection with any investigation or Action),
judgments, fines, penalties, charges and amounts paid in settlement
(collectively, “Losses”), as incurred, in each case
in connection with any offering of Registrable Securities in which a Selling
Holder is participating, (i) arising out of or based upon any untrue statement
(or alleged untrue statement) of a material fact contained in any applicable
Registration Statement (or in any preliminary or final Prospectus contained
therein, any document incorporated by reference therein or Issuer Free Writing
Prospectus related thereto) or any other offering circular, amendment of or
supplement to any of the foregoing or other document incident to any such
registration, qualification, or compliance, or based on any omission (or alleged
omission) to state therein (in the case of a final or preliminary Prospectus, in
light of the circumstances under which they were made) a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or (ii) any violation by the Company of the Securities Act or of the Exchange
Act in connection with any such registration, qualification, or compliance;
provided, that the Company will not be liable to a Selling Holder or
underwriter, as the case may be, in any such case to the extent that any such
Loss arises out of or is based on any untrue statement or omission by such
Selling Holder or underwriter, as the case may be, but only to the extent that
such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such Registration Statement (or in any preliminary or final
Prospectus contained therein, any document incorporated by reference therein or
Issuer Free Writing Prospectus related thereto), offering circular, amendment of
or supplement to any of the foregoing or other document in reliance upon and in
conformity with written information furnished to the Company by such Selling
Holder or underwriter specifically for inclusion in such document. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of any Holder Indemnitee or any other Holder and shall
survive the transfer of such securities. The foregoing indemnity agreement is in
addition to any liability that the Company may otherwise have pursuant to
contract or applicable Law to each Holder Indemnitee. 

     (b)     Indemnification
by Selling Holders. In connection with any Registration Statement in which a
Selling Holder is participating by registering Registrable Securities, such
Selling Holder agrees, severally and not jointly with any other Person, to
indemnify and hold harmless, to the fullest extent permitted by Law, the
Company, the officers and directors of the Company, and each Person who controls
(within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) the Company, and each underwriter, if any, and each Person who
controls (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) such underwriter, from and against all Losses, as incurred,
arising out of or based on any untrue statement (or alleged untrue statement) of a material fact
contained in any such Registration Statement (or in any preliminary or final
Prospectus contained therein, any document incorporated by reference therein or
Issuer Free Writing Prospectus related thereto) or any other offering circular
or any amendment of or supplement to any of the foregoing or any other document
incident to such registration, or any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the
statements therein (in the case of a final or preliminary Prospectus, in light
of the circumstances under which they were made) not misleading, in each case
solely to the extent that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such Registration Statement (or in any
preliminary or final Prospectus contained therein, any document incorporated by
reference therein or Issuer Free Writing Prospectus related thereto), offering
circular, or any amendment of or supplement to any of the foregoing or other
document in reliance upon and in conformity with written information furnished
to the Company by such Selling Holder expressly for inclusion in such document.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any of its directors,
officers or controlling Persons. The Company may require as a condition to its
including Registrable Securities in any Registration Statement filed hereunder
that the holder thereof acknowledge its agreement to be bound by the provisions
of this Agreement (including Section 2.5) applicable to it.

13 




     (c)     Conduct
of Indemnification Proceedings. If any Person shall be entitled to indemnity
hereunder (an “indemnified party”), such indemnified
party shall give prompt notice to the party from which such indemnity is sought
(the “indemnifying party”) of any claim or of the
commencement of any Action with respect to which such indemnified party seeks
indemnification or contribution pursuant hereto; provided, however, that
the delay or failure to so notify the indemnifying party shall not relieve the
indemnifying party from any obligation or liability except to the extent that
the indemnifying party has been actually prejudiced by such delay or failure.
The indemnifying party shall have the right, exercisable by giving written
notice to an indemnified party promptly after the receipt of written notice from
such indemnified party of such claim or Action, to assume, at the indemnifying
party’s expense, the defense of any such Action, with counsel reasonably
satisfactory to such indemnified party; provided, however, that an
indemnified party shall have the right to employ separate counsel in any such
Action and to participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such indemnified party unless: (i) the
indemnifying party agrees to pay such fees and expenses; (ii) the indemnifying
party fails promptly to assume, or in the event of a conflict of interest cannot
assume, the defense of such Action or fails to employ counsel reasonably
satisfactory to such indemnified party, in which case the indemnified party
shall also have the right to employ counsel and to assume the defense of such
Action; or (iii) in the opinion of the indemnified party’s outside legal counsel
a conflict of interest between such indemnified and indemnifying parties may
exist in respect of such Action; provided, further, however, that the
indemnifying party shall not, in connection with any one such Action or separate
but substantially similar or related Actions in the same jurisdiction, arising
out of the same general allegations or circumstances, be liable for the fees and
expenses of more than one firm of attorneys (together with appropriate local
counsel) at any time for all of the indemnified parties, or for fees and
expenses that are not reasonable. Whether or not such defense is assumed by the
indemnifying party, such indemnified party will not be subject to any liability
for any settlement made without its consent (but such consent will not be
unreasonably withheld or delayed). No indemnifying party will be subject to any
liability for any settlement made without its consent (but such consent will not
be unreasonably withheld or delayed). The indemnifying party shall not consent to entry
of any judgment or enter into any settlement that does not include as an
unconditional term thereof the giving by all claimants or plaintiffs to such
indemnified party of a release, in form and substance reasonably satisfactory to
the indemnified party, from all liability in respect of such claim or
litigation.

14 




     (d)     Contribution.
(i) If the indemnification provided for in this Section 2.5 is unavailable to an
indemnified party in respect of any Losses (other than in accordance with its
terms), then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the indemnifying party, on the one
hand, and such indemnified party, on the other hand, in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such indemnifying
party, on the one hand, and indemnified party, on the other hand, shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been taken by, or relates to
information supplied by, such indemnifying party or indemnified party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent any such action, statement or omission. 

          (ii)     The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 2.5(d) were determined by pro rata allocation or by any
other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. 

          (iii)     No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation. 

     (e)     Limitation
on Holder Liability. Notwithstanding anything to the contrary contained in
this Agreement, an indemnifying party that is a Holder shall not be required to
indemnify or contribute any amount in excess of the amount by which the net
proceeds received by such Holder from the sale of the Registrable Securities
sold by such Holder in the applicable offering exceeds the amount of any damages
that such indemnifying party has otherwise been required to pay by reason of the
applicable untrue or alleged untrue statement or omission or alleged omission.


     Section 2.6. Rule 144; Rule
144A. The Company covenants that it will file the reports required to be
filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder (or, if the Company is not required to
file such reports, it will, upon the request of any Holder, make publicly
available other information so long as necessary to permit sales pursuant to
Rule 144 or 144A under the Securities Act) to the extent required from time to
time to enable such Holder to sell Registrable Securities without registration
under the Securities Act within the limitation of the exemptions provided by (i)
Rule 144 or 144A or Regulation S under the Securities Act, as such Rules may be
amended from time to time, or (ii) any similar rule or regulation hereafter
adopted by the SEC. Upon the request of any Holder, the Company will deliver to
such Holder a written statement as to whether it has complied with such
requirements and, if not, the specifics thereof. 

15 




     Section 2.7. Underwritten
Registrations.     (a)     If
any Demand Registration is an underwritten offering, the Holders’ Representative
shall have the right to select the investment banker or investment bankers and
managers to administer the offering, subject to approval by the Company, not to
be unreasonably withheld or delayed. The Company shall have the right to select
the investment banker or investment bankers and managers to administer any
incidental or piggyback registration. 

     (b)     No
Person may participate in any underwritten registration hereunder unless such
Person (i) agrees to sell the Registrable Securities or Other Securities it
desires to have covered by the registration on the basis provided in any
underwriting arrangements in customary form (including pursuant to the terms of
any over-allotment or “green shoe” option requested by the managing underwriter,
provided that no such Person will be required to sell more than the
number of Registrable Securities that such Person has requested the Company to
include in any registration), and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements,
provided that such Person (other than the Company) shall not be required
to make any representations or warranties other than those related to title and
ownership of shares, authority to enter into the underwriting agreement, and as
to the accuracy and completeness of statements made in a Registration Statement,
Prospectus, offering circular, or other document in reliance upon and in
conformity with written information furnished to the Company or the managing
underwriter(s) by such Person and, provided further, that such Person’s
(other than the Company’s) liability in respect of such representations and
warranties shall not exceed such Person’s net proceeds from the offering. 

     Section 2.8. Registration
Expenses. The Company shall pay all reasonable documented expenses incident
to the Company’s performance of or compliance with its obligations under this
Article II, including, without limitation, (i) all registration and filing fees
(including fees and expenses (A) with respect to filings required to be made
with the SEC, all applicable securities exchanges and/or FINRA and (B) of
compliance with securities or Blue Sky laws including any fees and disbursements
of counsel for the underwriter(s) in connection with Blue Sky qualifications of
the Registrable Securities pursuant to Section 2.3(h)), (ii) printing expenses
(including expenses of printing certificates for Registrable Securities in a
form eligible for deposit with The Depository Trust Company and of printing
Prospectuses if the printing of Prospectuses is requested by the managing
underwriter(s), if any, or by the Holders of a majority of the Registrable
Securities included in any Registration Statement), (iii) messenger, telephone
and delivery expenses of the Company, (iv) fees and disbursements of counsel for
the Company, (v) expenses of the Company incurred in connection with any road
show, and (vi) fees and disbursements of all independent certified public
accountants (including, without limitation, the expenses of any “comfort”
letters required by this Agreement) and any other Persons, including special
experts retained by the Company. In addition, the Company shall bear all of its
internal expenses (including all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit, the fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange on which similar
securities issued by the Company are then listed and rating agency fees and the
fees and expenses of any Person, including special experts, retained by the
Company. The Company shall not be obligated to pay the fees and disbursements of
any counsel for the Holders in connection with any registration under Article II, or any underwriting fees,
discounts or commissions attributable to sales of Registrable Securities by
Holders thereof.

16 




ARTICLE III 

MISCELLANEOUS 

     Section 3.1. Conflicting
Agreements. Each party represents and warrants that it has not granted and
is not a party to any proxy, voting trust or other agreement that is
inconsistent with or conflicts with any provision of this Agreement. 

     Section 3.2. Termination.
This Agreement shall terminate at such time as there are no Registrable
Securities, except for the provisions of Sections 2.5, 2.6, 2.8 and this Article
III, which shall survive such termination. 

     Section 3.3. Amendment and
Waiver. This Agreement may not be amended except by an instrument in writing
signed on behalf of each of the Company, and the Holders of a majority of the
aggregate number of Registrable Securities then held by all Holders. Any party
hereto may waive any right of such party hereunder by an instrument in writing
signed by such party and delivered to the other parties (and, in the case of a
waiver of any rights of the Holders, by an instrument in writing signed by the
Holders of a majority of the aggregate number of Registrable Securities then
held by all Holders). The failure of any party to enforce any of the provisions
of this Agreement shall in no way be construed as a waiver of such provisions
and shall not affect the right of such party thereafter to enforce each and
every provision of this Agreement in accordance with its terms. 

     Section 3.4. Severability.
If any provision of this Agreement shall be declared by any court of competent
jurisdiction to be illegal, void or unenforceable, all other provisions of this
Agreement shall not be affected and shall remain in full force and effect. 

     Section 3.5. Entire
Agreement. This Agreement embodies the complete agreement and understanding
among the parties hereto with respect to the subject matter hereof and
supersedes and preempts any prior understandings, agreements or representations
by or among the parties, written or oral, that may have related to the subject
matter hereof in any way. 

     Section 3.6. Successors and
Assigns. Neither this Agreement nor any right or obligation hereunder is
assignable in whole or in part by any party without the prior written consent of
the other parties hereto; provided that the prior written consent of the
Holders shall not be required in connection with a sale or acquisition of the
Company, whether by merger, consolidation, sale of all or substantially all of
the Company’s assets, or a similar transaction, so long as such successor is
bound by the terms of this Agreement; provided further that Auvergne and
the Clay Family Holders may transfer their rights and obligations hereunder (in
whole or in part) to any other of Auvergne and the Clay Family Holders without
the prior written consent of the Company, and provided further that the
Holders may transfer their rights and obligations hereunder (in whole or in
part) to any other Person with the prior written consent of the Company.
Following such written consent, any such assignment shall be effective upon
receipt by the Company of written notice from the transferring Holder stating
the name and address of any Transferee and identifying the number of shares of Registrable Securities with respect to
which the rights under this Agreement are being transferred and the nature of
the rights so transferred and (y) a written agreement in substantially the form
attached as Schedule B hereto from such Transferee to be bound by the
applicable terms of this Agreement.

17 




     Section 3.7. Counterparts;
Execution by Facsimile Signature. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one instrument. This Agreement may be executed by
facsimile signature(s). 

     Section 3.8.
Remedies.     (a)     Each
party hereto acknowledges that monetary damages would not be an adequate remedy
in the event that any of the covenants or agreements in this Agreement is not
performed in accordance with its terms, and it is therefore agreed that, in
addition to and without limiting any other remedy or right it may have, the
non-breaching party will have the right to an injunction, temporary restraining
order or other equitable relief in any court of competent jurisdiction enjoining
any such breach or threatened breach and enforcing specifically the terms and
provisions hereof. Each party hereto agrees to waive any requirement for the
securing or posting of any bond in connection with such remedy. 

     (b)     All
rights, powers and remedies provided under this Agreement or otherwise available
in respect hereof at law or in equity shall be cumulative and not alternative,
and the exercise or beginning of the exercise of any thereof by any party shall
not preclude the simultaneous or later exercise of any other such right, power
or remedy by such party. 

     Section 3.9. Notices. All
notices required or permitted hereunder shall be in writing and shall be deemed
effectively given (i) upon personal delivery to the party to be notified, (ii)
when sent by confirmed facsimile if sent during normal business hours of the
recipient, if not, then on the next Business Day, (iii) upon receipt of proof of
transmission if sent by email or (iv) one Business Day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
addresses set forth below or such other address, email address or facsimile
number as a party may from time to time specify by notice to the other parties
hereto: 

If to the Company: Golden Queen Mining
Co. Ltd., 6411 Imperial Avenue, West Vancouver, British Columbia, Canada V7W
2J5; Attention: H. Lutz Klingmann (lklingmann@goldenqueen.com) and Andrée
St-Germain (astgermain@goldenqueen.com); and with a copy (which shall not
constitute notice) to: Morton Law LLP, 1200 - 750 West Pender Street, Vancouver,
British Columbia, Canada, V6C 2T8; Attention: Edward L. Mayerhofer
(elm@mortonlaw.ca), Esq.; Fax: (604) 681-9652. 

If to the Clay Family Holders:
Auvergne, LLC, c/o East Hill Management Company, 10 Memorial Drive, Suite 902,
Providence, RI 02903, Fax: 401-490-0749, Email: Thomas.Clay@easthillmgt.com,
with a copy (which shall not constitute notice) to: Sullivan & Worcester
LLP, One Post Office Square, Boston, MA 02109, Attention: William A. Levine,
Esq., Fax: 617-338-2880

18 




     Section 3.10. Nature of
Holders’ Obligations. The obligations of each Holder under this Agreement
are several and not joint with the obligations of any other Holder, and no
Holder shall be responsible in any way for the performance of the obligations of
any other Holder under this Agreement. Nothing contained herein, and no action
taken by any Holder pursuant hereto or in connection herewith, shall be deemed
to constitute the Holders as a partnership, a joint venture or any other kind of
entity, or create a presumption that the Holders are in any way acting in
concert or as a group with respect to such obligations or any of the
transactions contemplated by this Agreement.

     Section 3.11. Governing Law;
Consent to
Jurisdiction.     (a)     This
Agreement shall be governed in all respects by the laws of the State of New
York, without regard to its conflicts of laws principles. 

     (b)     Each
of the parties hereto (i) consents to submit itself to the personal jurisdiction
of any Federal or state court located in the Borough of Manhattan in the City of
New York, New York in the event any dispute arises out of this Agreement, (ii)
agrees that it will not attempt to deny or defeat such personal jurisdiction by
motion or other request for leave from any such court and (iii) agrees that it
will not bring any Action relating to this Agreement in any court other than a
Federal or state court located in the Borough of Manhattan in the City of New
York, New York. 

     (c)     Each
of the parties hereto hereby irrevocably and unconditionally waives trial by
jury in any legal Action or proceeding in relation to this Agreement and for any
counterclaim therein. 

[signature page follows] 

19 




     IN WITNESS WHEREOF, the parties
hereto have executed this Registration Rights Agreement as of the date first
written above. 


	GOLDEN QUEEN MINING CO. LTD. 
	 	  
	 	  
	By: 	/s/ H.
      Lutz Klingmann 
	 	Name: H. Lutz Klingmann 
	 	Title: President and Chief Executive Officer
  
	 	  
	 	  
	AUVERGNE, LLC 
	 	  
	 	  
	By: 	/s/
      Thomas M. Clay 
	 	Name: Thomas M. Clay 
	 	Title: Manager 
	 	  
	 	  
	 	/s/
      Landon T. Clay 
	 	Landon T. Clay 
	 	  
	 	  
	 	/s/
      Thomas M. Clay 
	 	Thomas M. Clay 
	 	  
	 	  
	 	/s/
      Harris Clay 
	 	Harris Clay 
	 	  
	 	  
	 	/s/
      Jonathan Clay 
	 	Jonathan Clay 
	 	  
	 	  
	LANDON T. CLAY 2013-4 ANNUITY TRUST 
	 	  
	 	  
	By: 	/s/
      Thomas M. Clay 
	 	Name: Thomas M. Clay 
	 	Title: Trustee 



[REGISTRATION RIGHTS AGREEMENT] 




SCHEDULE A 

	Landon T. Clay 
	Thomas M. Clay 
	Harris Clay 
	Jonathan Clay 
	LANDON T. CLAY 2013-4 ANNUITY TRUST







[SCHEDULE B] 

	Golden Queen Mining Co. Ltd. 
	6411 Imperial Avenue 
	West Vancouver, British Columbia 
	Canada V7W 2J5 
	Attention: President and Chief Financial Officer 
	  
	Ladies and Gentlemen: 


     Reference is made to the
Registration Rights Agreement, dated as of June __, 2014 (the “Agreement”).
Capitalized terms used and not otherwise defined herein are used herein as
defined in the Agreement. The undersigned (“Transferee”) hereby: (i)
acknowledges receipt of a copy of the Agreement; (ii) notifies the Company that,
on [Date], Transferee acquired from [insert name of assigning
Holder] (pursuant to a private transfer that was exempt from the
registration requirements under the Securities Act) [describe the Registrable
Securities that were transferred] (the “Transferred Securities”) and an
assignment of such transferor’s rights under the Agreement with respect and to
the Transferred Securities, and the Transferee has assumed from such transferor
the liability of the transferor in respect of any and all obligations under the
Agreement related to the Transferred Securities; and (iii) agrees to be bound by
all terms of the Agreement with respect to the Transferred Securities applicable
to a Holder of such Transferred Securities as if the Transferee was an original
signatory to the Agreement. Notices to the Transferee for purposes of the
Agreement may be addressed to: [•], [•], Attn: [•], Fax: [•]. This document
shall be governed by, and construed in accordance with, the laws of the State of
New York, applicable to contracts executed in and to be performed entirely
within that State. 


	[Transferee] 
	  	 
	  	 
	[By:] 	 
	Name: 	 
	[Title:] 	 



cc: [Transferor]